High prices are another dimension of the waste in the system, and what Dean
is talking about could reduce them. People are already resorting to foreign
sources to save money on treatments. The cost of a trip to the border of
Mexico is often offset by savings for dental care, ditto for trips to Oz or
SE Asia for surgery.
But a lower level of spending doesn't mean it wouldn't continue to grow
faster
than incomes. A lower level would buy us time to do something about the
growth
rate. We may decide utlimately that the growth is benign, per Cutler
and Hall.
Growth is partly a result of good things -- growing income and new
health care
treatments and some other stuff getting cheaper.
Laurence Shute wrote:
Here's another view on Cowen's article by Dean Baker in his Beat the Press:
NYT Protectionists Strike Again
The NYT is so dogmatically protectionist in some areas that it will not
even allow discussion of free trade on its pages. The protectionist
doctrine is perhaps nowhere deeper than in the treatment of health care.
The United States has a hugely inefficient health care system. We pay
more than twice as much per person as the average for other wealthy
countries yet we rank near the bottom in most measures of health
outcomes. Reform is blocked by the power of the insurance and
pharmaceutical industry, as well as the doctors' lobbies.
The obvious solution would be to make it easier for people in the United
States to take advantage of the more efficient health care systems
elsewhere in the world. But the NYT never even has allowed this idea to
be discussed in its pages.
Instead, we get diatribes from protectionists like Tyler Cowen, who
warns that we will be forced to pay 60-80 percent of income in taxes by
the end of the century if we don't change the current structure of
Medicare. (You get these numbers by assuming that health care costs
continue to grow much faster than income, leading to large budget
deficits, and that Congress lets the deficits get ever larger [never
raising taxes or cutting spending] so that by the end of the century the
country has an incredible debt and interest burden. It's not a serious
projection, but it's good for scaring people.)
The U.S. health care system is seriously broken. If the political system
is too corrupt to fix it, then people in the United States should be
allowed to take advantage of health care systems that work. It should be
possible to talk about trade in health care services in a serious
newspaper.
Larry Shute
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